What to Do if the Other Party Breaches your Contract

No matter the type of business you own or manage, contracts are certainly a daily, and integral part of business. With every contract there is always the possibility of the other party breaching the contract, regardless of the terms and relationship. Breaches of contract always run the risk of harm to your business, so it is important to work with an experienced business lawyer in Los Angeles to protect your business in the event of breach in the best possible manner.If drafted correctly, a contract should dictate your rights and options to seek legal remedies in the event of a breach. An experienced business lawyer can assist you through this process in its entirety.

What is a Breach?

One party’s failure to fulfill any of its contractual obligations is known as a breach of contract. Dependent on the specific circumstances, a breach can occur when a party fails to perform on time, does not perform in accordance with the terms and conditions, or completely fails to perform.

What if a Breach Occurs?

1. Talk to the Breaching Party: There are occasions in which the breaching party may not even be aware that they were in breach. Simply having a conversation with the other may save extensive time and money down the road. Further, if the breach involves, for example, non-payment, there may be ways to agree on a payment plan or another arrangement to fulfill the contract without seeking legal action.
2. Discuss Statute of Limitations: If you are concerned that legal action may be necessary, you should consult with your attorney immediately. Under California law, you only have up to four years to file a breach of contract claim for a written contract. However, some written contracts only have a two-year limit.
3. Discuss Damages: In a breach of contract claim, you must seek specific relief. This can include specific performance, which is when the court orders the breaching party to fulfill their contractual obligations. In most cases, though, a breach will result in monetary losses, and the plaintiff will seek damages for lost profits or unnecessary costs due to the breach. Types of damages may include compensatory damages, punitive damages, and nominal damages.
4. Consider Alternative Options: Not every breach of contract claim goes directly to court. Often times, the issue can be resolved through alternative dispute resolution, such as mediation or arbitration. Some contracts even include clauses requiring that any litigation be brought through arbitration or mediation first. This option can save time and money, but is not always the best option and depends on the type of contract and the nature of the parties involved.
5. Prepare for Lawsuit: Your lawyer will advise when all alternative dispute resolutions options have been exhausted. At that point, your only option may be to file a lawsuit for breach of contract. When a lawsuit ensues, your attorney will work closely with you to file the complaint and make determinations such as proper jurisdiction and venue.

As one of the leading business lawyers in Los Angeles County, Afshin Hakim of Hakim Law Group, will be able to assist you in protection from a breach of contract, as well as the processes and procedures to follow in the event that a breach occurs. For further information or to schedule a consultation with Afshin Hakim please contact HLG at 310.993.2203 or visit www.HakimLawGroup.com to learn more.